Certain portions of scholarships (college, union or organizational scholarships, fellowships and tuition waivers) and other forms of student grants (TAP/APTS, Federal PELL, FSEOG, CD, etc.) must be reported as taxable income on your tax return. Calculate the portion of your financial aid to be included in your taxable income by adding up your total grant aid and subtracting out the cost of tuition, fees, books, supplies and equipment required for your courses of instruction. You must be a matriculated student to exclude grant or scholarship aid from your taxable income. Non-degree students receiving some type of grant or scholarship must include all of that grant aid as taxable income!

It is important that you keep records of all your educational expenses, such as Bursar's receipts to document tuition and fees, and sales receipts to document book and other course related expenses. You will have to separate the taxable and non-taxable amounts of your financial aid when filing your federal tax return and will have to be able to document permitted expenses. It is your responsibility, not the school's, to determine the amount of financial aid you must include in your taxable income!

NOTE: Loans are not subject to taxation. Federal Work-Study earnings, as always, are taxable as wages.

For more information about taxable financial aid grants, along with other information about income tax obligations and benefits for students, go to this Internal Revenue Service student web site.